Mounting fiscal surprises are a bad sign for Liberals

The federal Liberals are starting to act like there’s no deficit spending they wouldn’t like.

When Finance Minister Bill Morneau gave an update on the government’s fiscal situation on Monday, he did so without the slightest sign of contrition for the surprise $8.4 billion in extra deficit predicted for the 2016-17 fiscal year. No amount of blame laid at the previous government’s feet, or on the massive drop in the price of oil, can account for this sudden shift in the federal government’s fiscal fundamentals. The mounting bill — going way beyond the Liberals’ pledge of modest deficits during the election — can be blamed on the government’s failure to cost its platform properly. This doesn’t augur well, for a number of reasons.

The most important reason may be the reputation of those promises the Liberals made during the election. The dramatic increase in Syrian refugees, the launch of the inquiry into missing and murdered indigenous women, and the new mission against the Islamic State all represent deep shifts in the country’s moral direction. Agree with them or not — they still represent a new commitment by the government of Canada to humanitarianism principles and equality for Canada’s indigenous peoples.

But if this new face for Canada comes at an unpredictable financial cost, Canadians will only grow more cynical about our ability to resolve these problems. Already, the Liberals have taken flak over the number of criminal incidents that may be a part of the inquiry into missing and murdered indigenous women. So much of the news coming from the government’s top echelons in recent months seem to be about surprise costs and unexpected detours.

The average Canadian has only a limited sum of patience with surprises. A government in waiting should have the wisdom and integrity to chart where its promises may lead the country. Morneau’s fiscal update is the deepest evidence so far that the Liberals have no idea where the ship of state is going, especially when it comes to finances. Canadians get the link between deficits and social programming. For them to have faith in the new vision for Canada, they need to have faith in the numbers, too.

That brings us to a second negative impact. The fact that fiscal sustainability has become an integral part of any conversation on political ideas in Canada is a good thing. The emphasis on keeping debt and deficits low over the past three decades represents a positive step in Canada’s political discourse. Any decline in that emphasis would lead to poor policy in the future. Morneau doesn’t need to pander to small-government ideologues or offer the public simplistic populism about respecting taxpayers. But acting as if returning to balance eventually isn’t part of the plan anymore – an integral part of the promises the Liberals made during the election — does a great disservice to Canadian public life.

And that brings us to the final point. The Liberals committed to small deficits and a return to balance. It wasn’t a Hail Mary pass for more votes, but a critical piece of the platform, presented as if it were well thought-out and as important to them as it was to voters.

The unexpected deficit figure only makes it harder to buy the Liberals’ claim that their openness to deficits is about being more honest with Canadians. A sense of betrayal over the party’s fiscal promises has the potential to morph into any number of political crises. Morneau and Prime Minister Justin Trudeau need to say no to certain promises for the sake of the critical pledge they made on deficits.